Oil is heading in the right direction

21 February, 2017

Despite the assurance about the soft Brexit from the British Prime Minister the in consideration of the bill has been proving opposite, and the suppressing growth attempts of the British currency. Pro-European members of the House of Commons were left to the side, as the bill passed to the House of Lords without the amendment guaranteeing the rights of EU citizens staying in the UK. This issue raises concerns among the European politicians who remain as cornerstones in the talks of retaining UK access to the EU single trade market.

The hope remains in House of Lords which is began the reading of the bill on Monday. Elected for life, its members will be more active in advocating close ties with the EU as this should be approved by the House of Commons. This situation knows as “ping-pong” creates uncertainty in the final version of the bill, putting brakes on the sterling rally. The date for a final vote on Brexit is set for 7 March a couple of days before the start of the EU summit in Brussels.

The US currency completed its pullback last week and resumes a rally fueled by investors’ optimism regarding the US growth and FED rate hike prospects. Taking off from the 100.50 level the Dollar index reaches 101 marks in anticipation for the release of Trump’s tax plan. EUR/USD sticks to the 1.06 level also the pressure on Euro has increased slightly according to the CFTC data with a net position of Euro falling from -44951 to -46774, as contracts of the week are ending on February 12. Staying at the peak- the growth attempts of US currency are pretty limited, though, featured with erasing declines from the pullbacks. Closing up the week in the green zone the US equity markets took respite on the account of Washington’s day in the US.

The Oil prices set for a rally, as investors are not losing faith in OPEC output cuts and are betting on growth with open eyes.  Oil futures added 1$ last week taking into account the contract change in April 2017.


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